PPA Launches New UIGEA Initiative

With the prospect of the Unlawful Internet Gambling Enforcement Act regulations coming into force on June 1st, the Poker Players Alliance has petitioned the U.S. Treasury Department and Federal Reserve Board to clarify that the Act's definition of illegal gambling does not include peer-to-peer games such as poker.

The petition is addressed to Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke, and it requests a sub-paragraph amending the regulations to state that the term "bet or wager" does not include a bet or wager on "certain peer-to-peer games where the outcome is determined predominantly by the skill of the players, such as poker, chess, bridge, mah-jong, and backgammon."

The petition also asks for clarification that pari-mutuel animal racing that is lawful under the Interstate Horseracing Act is not affected by the UIGEA.

The PPA has managed to get twenty-two members of Congress to support the petition, which is currently with the addressees.

John Pappas, executive director of the PPA said: "The PPA is grateful for the support of the 22 members of Congress who wrote Secretary Geithner and Chairman Bernanke in support of our petition to exempt peer-to-peer gaming from the UIGEA regulations,

"We are still strongly supporting legislative efforts to license and regulate online poker and provide the consumer protections that the UIGEA will not, and are hopeful of the passage of bills like [Congressman Barney Frank's] HR 2267, but believe our petition is the best bet to address the short-term issues facing online poker."

Pappas said that the objective of the petition was clarity on the ambiguous phrase “unlawful internet gambling” in the regulations, which places the onus of interpreting the definition on the financial institutions that are supposed to enforce the Act by halting financial transactions with online gambling companies. There are fears that the imprecise definition will lead to major enforcement problems and the risk of over-blocking by banks.

The legality of Internet poker in the U.S. is uncertain as there is no federal law and very few state laws specifically outlawing the playing of Internet poker.